Investor Tribes – which group dominates buy to let?
Everyone has different reasons for choosing to invest in property. The returns and capital growth can be hugely profitable and from our own internal research, many investors have differing reasons and motivations as to why they’ve invested in buy to let.
Sequre researched a cross section of clients to find out what motivated investors into investing into buy to let property. From the results, we found that there were four distinct categories to which the majority fell into. They were:
1) Pot Hunters -
those investing for retirement/to replace their pension
The number of those looking for pension replacement from property has increased - 48% noted it as their main motivation for choosing buy to let. With the spotlight on pensions over the years, it’s understandable that more of the UK are looking at property to generate a comfortable income later in life. Poor annuities have often left people in retirement without a decent nest egg, but property can substitute not only monthly income, but provide a tangible asset that continues to go up in value and provide sizable returns. It can also be passed down to loved ones later down the line.
2) Chieftains -
those looking to build a strong property portfolio
Following on from the pot hunters, 20% of investors stated that building a portfolio was their reason for investing in property. By using the returns from buying one property to put into another, investors can generate greater profits by reaping the benefits from owning not just one property, but two, three, four and so on. Creating an “empire” of properties allows many investors to venture down the road to complete financial freedom, creating enough income to work part-time or even solely live off the returns made from property.
3) The Warriors -
young investors looking to make a secondary income or get onto the property ladder
The third most popular motivation was primarily focused on a younger type of investor – the Warriors made up 15% of the “Investor Tribes”. It was noted there had been a 2% rise in this type of investor over the last two years, primarily as an accessible way for those aged 21-30 to get on the ladder by purchasing affordable property and using the returns to fund their lifestyle or save for their own residential property.
4) The Protectors -
investing for the future of their children or loved ones
Finally, 13% of Sequre’s investors admitted their family were at the forefront of their property purchase. It could be a purchase to later pass on to children to serve as their first rung onto the property ladder, or a tangible asset which the family can continue to enjoy the healthy returns from. While making strong returns is still the primary goal for the Protectors, it’s almost always for the benefit of others.
Do you fit into our “Investor Tribe”? Whether you’re looking for a property to supplement your pension or an asset to pass onto your loved ones, Sequre can help provide you with all the help and guidance you need to embark on your property journey. We’re specialists in the buy to let market and source properties only with genuine discounts which are often fully tenanted – resulting in an income from day one. To find out more, call us on 0800 011 2277.